Camera does not matter since when I capture from to my desktop (which is lesser quality then my new laptop) I do not have any distorted picture problems.

Capturing through vegas...in HDV

Could it just be a bad install of Vidcap? What happens if you copy vidcap.exe and the vidcap plugins folder from the the computer that works to the computer that doesn't?

A shot in the dark, but if you make a copy of the originals, no files will be harmed if you try...

Still having the same issue, also seeing the issue with windows movie maker...this is so bizarre...i can't believe I am the first to have this issue, I tried to google the issue but came up with nothing.

Any help would really be appreciated

If anyone can resolve this issue I will gladly paypal you $100!

Need this resolved and I am out of ideas.

Every now and then, it will capture fine...I have been unable to replicate it on demand...sometimes i unplug it and restart and plug it in and it records fine...but its about 1 in 100 or so attempts to capture...not sure if this info can help pinpoint the issue?

Since you tried all that stuff and you still have problems, might just be a faulty controller or fw driver. In that case, you'd need to change your hardware. If that laptop doesn't work as well as your PC, sell it, get another one. Or, get another camera. That's what I do when I have hardware that doesn't work as well as I expect it to.